Yesterday, we opened a sell forex signal in EUR/GBP. This forex pair has been trading in a range between two moving averages for more than two months. Yesterday though, this forex pair was making a retrace higher on the H4 chart, so we saw that climb as an opportunity to open a sell forex signal.

That signal hit TP in no time, and today we are seeing another chart setup similar to the one we saw yesterday.

The 50 SMA is providing resistance again today.

As you can see from the EUR/GBP chart above, this forex pair has gone through another retracement period during the night. It reached the 50 SMA (yellow) a few minutes ago but that was it. The price touched it and quickly reversed. This sort of price action means that there are sellers clustered up there waiting for a chance to sell.

The stochastic indicator is not overbought yet, which means that the retrace is not totally complete on this chart frame. But, the H1 chart is already overbought.

Anyway, by the time this candlestick closes, the chances are that stochastic will become overbought. Also, if the current candlestick closes where it opened, it will be another great bearish sign. A pin or a doji is always a great sign of a reversal after a trend or after a retrace.

I will let this candlestick close first. Then, if the price gets close to the 50 SMA again, I will probably be persuaded to open another sell forex signal up there.